The cryptocurrency world is currently abuzz with anticipation as a significant event looms on the horizon: the expiration of nearly $3.7 billion in Bitcoin options on November 8. This event, which surpasses the previous week’s expiration, coincides with major happenings such as the U.S. elections and the Federal Open Market Committee (FOMC) meeting. Such large-scale options expiries can often lead to substantial market movements and sell-offs.
$3.7 Billion Bitcoin Options Expiry
According to recent data from Deribit, approximately 48,794 Bitcoin options contracts, valued at around $3.7 billion, are set to expire. These contracts exhibit a put-to-call ratio of 0.72, indicating a relatively balanced distribution between bearish and bullish market positions. The maximum pain point, which is the price level where the majority of options would lose their value, is established at around $69,000.
There is a notable concentration of open interest, amounting to $1.7 billion, at the $80,000 strike price. This suggests that a subset of traders remains hopeful of a potential price surge. Following the election results, trading volumes soared to a daily record of $60 billion, spurred by Donald Trump’s victory. Bitcoin subsequently achieved a new all-time high (ATH) of $76,940, reflecting a positive market sentiment.
Analysts Signal Possible Profit-Taking
Experts at the crypto derivatives platform, Greeks Live, have observed a trend of profit-taking within the options market. This suggests that the election-induced rally might be nearing its conclusion. The platform highlighted that the election market is cooling rapidly. Despite the robust gains in both Bitcoin and Ether and the prevailing optimistic sentiment within the crypto sphere, the options market is showing signs of profit-taking, marking the end of the election-driven momentum.
Additionally, Greeks Live reported a decline in “doomsday” Bitcoin options, which allow investors to exit contracts prematurely. This shift indicates a more optimistic outlook among market participants.
Ethereum Options Set to Expire Too
In tandem with Bitcoin’s significant expiry, approximately 294,000 Ethereum options contracts, valued at $850 million, are also due to expire today. These contracts feature a put-to-call ratio of 0.65, with a maximum pain level of $2,500. In total, the options expiries across both Bitcoin and Ethereum amount to nearly $4.5 billion.
Meanwhile, Bitcoin and Ethereum have reached new peaks, with Bitcoin at $76,872 and Ethereum at $2,950. While some altcoins have experienced a cooling off following recent rallies, Solana (SOL) and Cardano (ADA) continue to demonstrate growth, with increases of 5% and 14%, respectively.
Conclusion
As the cryptocurrency market braces for these significant options expiries, traders and investors are keenly observing how these events will influence market dynamics. The balance between bullish and bearish positions, coupled with external factors like elections, could create an unpredictable landscape in the coming days. Market participants are advised to remain vigilant and consider potential outcomes as the expiry date approaches.
